Wal-Mart Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Wal-Mart Stores (NYSE:WMT) will unveil its latest earnings tomorrow, Thursday, August 16, 2012. Wal-Mart Stores operates Walmart discount stores, supercenters, Neighborhood Markets and Sam’s Club locations in the United States.

Wal-Mart Stores Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of $1.17 per share, a rise of 7.3% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved up from $1.16. Between one and three months ago, the average estimate moved up. It has been unchanged at $1.17 during the last month. Analysts are projecting profit to rise by 9.4% compared to last year’s $4.91.

Last quarter, the company came in at net income of $1.09 per share against a mean estimate of profit of $1.04 per share, beating estimates after missing them in the previous quarter. In the fourth quarter of the last fiscal year, it missed forecasts by one cent.

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Stock Price Performance: Between May 16, 2012 and August 14, 2012, the stock price rose $14.66 (24.70%), from $59.35 to $74.01. The stock price saw one of its best stretches over the last year between July 2, 2012 and July 13, 2012, when shares rose for nine straight days, increasing 5.5% (+$3.83) over that span. It saw one of its worst periods between March 15, 2012 and March 21, 2012 when shares fell for five straight days, dropping 1.1% (-67 cents) over that span.

A Look Back: In the first quarter, profit rose 10.1% to $3.74 billion ($1.09 a share) from $3.4 billion (97 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 8.5% to $113.02 billion from $104.19 billion.

Wall St. Revenue Expectations: Analysts predict a rise of 5.7% in revenue from the year-earlier quarter to $115.56 billion.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 5.4% in the second quarter of the last fiscal year, 8.1% in the third quarter of the last fiscal year and 5.9% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Heading into this earnings announcement, the company is trying build on some positive momentum from last quarter’s income increase. After net income declines in the third quarter of the last fiscal year and fourth quarter of the last fiscal year, profit rose in the first quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.83 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations. The company regressed in this liquidity measure from 0.88 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 10.7% to $68.98 billion while assets rose 4.2% to $57.28 billion.

Analyst Ratings: There are mostly holds on the stock with 12 of 23 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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